Reddit CEO Steve Huffman has hinted that in future some subreddits could be paywalled, as the company seeks to devise new sources of income.
Huffman raised the prospect during an earnings call in which he said Reddit would also be testing AI-powered search results later this year …
Reddit’s drive for cash
Reddit has been very focused on making money both in the run-up to its IPO, and since.
The first big news on this front was more than a year ago, when the company started charging developers for API calls, forcing the closure of the popular third-party app Apollo. That led to wide-scale protests that the company had to forcibly shut down.
It was subsequently revealed that the company had signed a deal with Google to allow Reddit posts to be used as training data, which later saw the company blocking all other search engines.
AI search could generate ad revenue
Top comment by John Atkinson
I have doubts that this could work in practice, primarily because a big part what makes reddit useful is the ability for anyone to comment, you'd lose the people who have knowledge but aren't going to spend money to share it. Then there's moderation; is reddit going to pay for moderation because its a paid premium experience, unlikely as they just want money but then who is going to spend the money to moderate ie who's going to pay to volunteer for a company; or will moderators get free access in which case how do you get the moderators in the first place?
What will likely happen is these paid subreddits will end up being just like the wave of dead subreddits, you'll occasionally see a post that might get some interaction but it's not people's go to place. They may get a ton of people for the first month or two trying it out(especially if there's a free trial) but very few people will be interested in paying and the subreddits will die down until no one is left, after all if there's no content then why would you keep paying and it would enter a death spiral as more people have that same thought.
Engadget reports that Huffman now sees AI-powered search as a potential revenue source.
During the call, the Reddit co-founder said the company would begin testing AI-powered search results later this year [and] that search could one day be a significant source of advertising revenue for the company.
Some subreddits could be paywalled
More worryingly, Huffman also hinted that in future some subreddits could be paywalled.
He suggested that the company might experiment with paywalled subreddits as it looks to monetize new features. “I think the existing, altruistic, free version of Reddit will continue to exist and grow and thrive just the way it has,” Huffman said. “But now we will unlock the door for new use cases, new types of subreddits that can be built that may have exclusive content or private areas, things of that nature.”
9to5Mac’s Take
This is another move likely to anger Redditors. While the platform is a commercial enterprise, its value derives almost entirely from freely offered user content. That means Redditors feel at least some sense of ownership in a community endeavour, so the company needs to tread carefully when it comes to monetization at user expense.
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